Nestlé has reported stronger-than-expected sales growth for the third quarter of 2026, as Chief Executive Officer Philipp Navratil’s turnaround strategy begins to show progress.
The Swiss food and beverage giant recorded a 4% increase in organic sales, surpassing analysts’ expectations of 3.4%. Its shares rose by around 1.5% following the announcement, reaching a three-month high. The stock has gained more than 7% so far this year.
Navratil, who became CEO in September 2025, inherited a company facing weak consumer spending and the effects of US tariffs. Since taking over, he has prioritised real internal growth, which measures sales volumes, while pursuing plans to reduce Nestlé’s exposure to ice cream, water and vitamin brands.
“I am pleased with our progress,” Navratil said. “But I am not satisfied. There is much more for us to do to deliver the potential of the business.”
Nestlé maintained its full-year 2026 organic sales growth forecast of between 3% and 4%, despite ongoing pressure on consumers and rising business costs.
Real internal growth reached 2.8%, comfortably exceeding analysts’ expectations of 1.5%. Meanwhile, price increases contributed 1.1% to sales growth, below the projected 1.9%.
The results marked the first quarter since 2024 in which Nestlé’s organic sales growth was driven more by higher sales volumes than by price increases.
Analysts at Vontobel described the volume-led performance as reassuring, saying it provided further evidence that the company was delivering on its growth priorities. However, they cautioned that maintaining consistent progress would remain a key test.
Barclays analyst Warren Ackerman said pricing would remain a major issue heading into 2027, particularly as consumers face tighter budgets and businesses contend with rising input costs. These pressures could also affect Nestlé’s profit margins next year.
Chief Financial Officer Anna Manz sought to address concerns about the lower-than-expected contribution from price increases, explaining that the company had implemented more gradual price adjustments in 2026 compared with the significant increases introduced in 2025.
“We’ll take pricing to the extent we can without damaging medium-term consumer penetration,” Manz said. “As we look forward to 2027, it is an inflationary environment, it’s likely we’ll see more pricing.”
Nestlé Excludes Russian Business From Financial Results
Nestlé also announced that it had excluded its Russian operations from its consolidated financial accounts after Moscow seized the business last month.
The move comes amid an intensifying crackdown on European companies in Russia, linked to Europe’s support for Ukraine.
The company, which owns brands including Maggi and Nescafé, played down the overall impact of losing its Russian operations, which accounted for approximately 2% of group sales.
Manz said the Russian business had stopped being included in Nestlé’s consolidated financial results from the end of September. Its exclusion would not affect organic sales growth, sales volumes or pricing.
However, the development is expected to affect reported sales, underlying trading operating profit and free cash flow from the fourth quarter of 2026.
Manz added that removing the Russian business’s net assets from the accounts would negatively affect net debt by approximately 900 million Swiss francs, or $1.1 billion, in 2026.
Nestlé said it was removing Russian assets worth 1.6 billion Swiss francs from its balance sheet and recording a non-cash charge of approximately 1.4 billion Swiss francs related to cumulative currency translation adjustments.
Despite the challenges, the latest results suggest that Nestlé’s efforts to strengthen sales volumes are beginning to gain traction. The company’s ability to sustain that growth while managing pricing pressures, inflation and the loss of its Russian operations will remain important to its performance in the coming year.
